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China's Xi will visit North Korea to push for deeper ties
China announced on Friday that President Xi Jinping will visit North 'Korea for a two-day tour starting June '8. This is his first trip in almost seven years. Beijing wants to reassert ties Pyongyang as its only formal treaty ally. Beijing is trying to bring Pyongyang into its fold again after the COVID-19 virus pandemic frozen exchanges. Kim Jong Un has also deepened relations with Moscow, sending troops and arms to support Russia's invasion in Ukraine. John Delury is a senior fellow at the Asia Society. He said, "The implicit message from the Chinese side... is that we are still the main actor when it comes North Korea." "Russia is one of the audiences." The announcement made by the Chinese Communist Party's international department on Friday follows Xi’s summits with Donald Trump, the U.S. president and Vladimir Putin, the Russian president in Beijing last'month. KCNA, the state news agency, reported that Xi was visiting North Korea on Kim's invitation. An official of the Blue House, the president's presidential office, said that South Korea views the trip as a high-level bilateral meeting unaligned with Moscow. The official stated that "we do not see this as a coordinated action by the three countries. Neither are we certain how it could be related to the U.S. China summit." Seoul expects Beijing will continue to play a 'constructive role in peninsula issues', the Blue House said separately. Kim was invited to a large military parade held in Beijing, China last September. He arrived on his green armored train. After a six-year hiatus caused by the pandemic in 2009, passenger train services resumed between the two capitals in March. Air China then restarted flights. Chinese tourists are still not allowed to book, but some business travellers and students on exchange have. First Overseas Trip This Year Xi will make his first overseas trip this year when he visits Pyongyang. The 72-year old, who travels abroad less often, was last seen in South Korea at the end of October, where he met Trump. Delury said that Xi should keep a close eye on the situation in Pyongyang. He said Xi's visit to both Koreas would be a 'big?win' for the peninsula. He added that "the Chinese are fond of maintaining a certain symmetry" between the two Koreas. Trump has said that he is open to another meeting with Kim, the North Korean leader, after having met him three times during his first term. Since Xi was appointed China's leader in 2012 he has visited North Korea twice and its southern neighbor once. In 2008, he visited Pyongyang as vice president and met the then-leader Kim Jong Il. He is the father of?the current leader. Kim, who visited a factory to make nuclear material this week, called for a "significant" expansion of Pyongyang’s atomic arsenal. Experts believe that Kim's visit to the site is linked to his upcoming meeting with Xi. Kim had inspected the plans of a new intercontinental missile called "Hwasong-20" before his visit to Beijing in September. Reporting by Xiuhao chen and Liz Lee, in Beijing; Jack Kim, Kyu -seok Shim, and Brenda Goh, in Seoul. Editing by Himani sarkar, Kate Mayberry, and Clarence Fernandez.
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Take Five: Houston we have an IPO
SpaceX's public listing will be the main event, as it is likely to become among the 10 most valuable U.S.-listed companies after it goes public. Meanwhile, a rate increase from the European Central Bank seems inevitable on Thursday. OPEC+ meets in the background of the Iran War to decide on its oil production quotas. On Thursday, the World Cup begins in Mexico. Lewis Krauskopf, Gregor Stuart Hunter, Karin Strohecker, Yoruk Bahceli and Ahmad Ghaddar, all from New York, and?Yoruk?Bahceli in London, will provide you with the information that you need about this week's financial markets. IP-OH! Wall Street braces for Elon Musk's rocket-and-satellite company SpaceX to make its initial public offering -- an event that is likely to be the first in a series of mega IPOs over the next few months. SpaceX's Nasdaq launch -- which is expected to take place on June 12 -- is fast approaching, as the high-flying technology stocks have been leading a spectacular rally for major U.S. stock indexes. The company plans to raise $75 billion, a record amount. It aims for a $1.75 trillion valuation. OpenAI, a giant in the AI field, is also expected to make its debut soon after. Anthropic announced on June 1 that it had filed a confidential U.S. IPO. Investors will be focusing on the monthly U.S. Consumer Price Index as they grapple with inflation concerns triggered by higher energy costs. Oracle's quarterly earnings report will continue to keep the tech stocks and AI hot trade in the spotlight. NIP IT IN BUD The ECB will be the first of the world's largest central banks to raise rates since the Iran war. Frankfurt wants to avoid the same mistake as 2022. The 25-basis point rate increase expected on Thursday is seen as an "insurance", signaling that the ECB will not allow inflation to become entrenched, rather than the beginning of a large-scale hike cycle. The current crisis has already impacted the economy, and policymakers must tread a fine line to avoid accelerating the decline. The markets believe that the ECB will only raise rates twice or three times in this year. The 2026 FIFA World Cup begins on Thursday. Mexico, Canada and United States will co-host the world's largest sporting event. Last time, approximately 5 billion people watched the event. With more teams and venues to choose from, we can expect an even larger global binge. As fans flock to the United States, they buy beer, and purchase merchandise. The macro boost The macro boost is less spectacular. Growth tends to be short lived and spending often gets reshuffled. For the office sweepstake, Goldman Sachs' model, based on Elo scores for chessplayers, gives Spain a 26% edge, followed by France. Argentina, and Brazil. Business as usual Sources say that OPEC+ Ministers will agree on a target increase for July production this Sunday as they signal business as usual despite Iran's war. Investors are waiting for progress in the peace talks that could open up the Strait of Hormuz. Prices fell by more than 19% in May, mostly on the hope of a deal. From April to June, seven core OPEC+ member countries have increased their quotas nearly 600 000 barrels per day. Yet, actual production has fallen to 33.19 millions bpd from 42.77 in February. The July quota will be up by 188,000 bpd in line with the June quota. The International Energy Agency warned that global inventories may reach critical levels before summer peak demand. CHINA HEALTH CHECK China will have its monthly health test in the next week. Trade data for May is due to be released on Tuesday and should provide the latest update as to how Asia's largest economy coped with the Iran War's third month. Investors will be able to get a second read on Wednesday, including whether the consumer price inflation will continue on its upward trajectory that it has been on since October. The gauge for producer prices, which turned positive in March after almost four years of negative readings, will also be a focus. The data on lending for May will also be released this week. The total social financing, which is the broadest measure of credit to China's economy, showed the lowest growth in two years for April.
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Maguire: Key reasons why Trump’s efforts to save the US coal industry may fail.
The U.S. president's efforts to revive the coal industry in the United States tap into a powerful mix of energy policy, industrial policy, and electoral politics. But the data shows that coal's decline has been driven by structural factors that are unlikely ever to reverse. This means that even if the administration allocates tens or hundreds of millions to coal producers and utilities, it is likely to result in a misallocation, increased emissions and higher electricity costs for consumers. There are four reasons that efforts to support coal may ultimately fail. 1. ECONOMICS ARE STUBBORNLY UNFAVORABLE Why subsidizing coal could backfire. Subsidizing the coal industry is contrary to market fundamentals. Taxpayers are left to support a non-competitive sector while power prices rise. The share of coal in the U.S. electric generation fell from 60% in 2000 to 16% by 2025. Natural gas has become more popular, cheaper and more energy dense. It is also easier to transport. The market tells a different story. Since the early 2000s, no U.S. utilities have attempted to build any new coal-fired plants. During the same time period, many gas-fired power plants were built, reflecting a much stronger economics as well as operational advantages. The difference is apparent in the levelized costs of energy. Lazard data shows that the cost of power from a new gas plant is about $64/MWh, compared to $115/MWh with a coal plant. When utilities are focused on minimizing customer costs, they have little incentive to select coal. The economics of existing coal plants are even worse due to their age, high maintenance costs and inefficiency. Government subsidies may prolong the operation of coal plants, but only if they extend?the lives of assets that are already obsolete economically. 2. CONSTRUCTION COMPLEX AND RISKY This could be a bad idea: Because coal plants are slower and harder to build, they're more likely to experience delays and overruns in cost even with government support. Construction of modern combined-cycle gas generator (CCGT?) plants is relatively fast and easy. By contrast, coal plants require large boilers, fuel handling systems and specialized infrastructure. Gas plants can burn fuel without any pre-processing. Coal plants must handle large volumes of solid fuels, which require transport, crushing and storage yards. They also need elaborate combustion systems. These systems also require expensive emissions-control technologies and ash disposal system, which adds to capital costs and regulatory complexity. The land requirements are also typically larger. The industry has lost a lot of knowledge. Few utilities or contractors have experience in building coal plants after decades of prioritizing the use of gas. Execution risks are increased, increasing the possibility of delays and unanticipated costs. These factors together make coal projects more costly, slower and less predictable. This is true even when the environment is favorable. 3. LOGISTICAL BURDENS The heavy transport and handling of coal can cause local opposition and increase costs. Gas is much easier to transport than coal. Gas can be transported continuously and cheaply via pipelines, while coal is hauled either by rail, truck or barge. According to the U.S. Energy Information Administration (EIA), approximately 1.14 pounds coal is needed to produce one kilowatt hour of electricity. One gigawatt of coal can be used to generate around 9,000 metric tonnes of coal each day. This is the equivalent of 90 freight cars in a freight train. A gas plant of the same size, on the other hand, would consume approximately 170 million cubic foot of natural gas per day, a volume which can be easily pumped through existing infrastructure. In order to expand coal power, it would be necessary not only to build new plants, but also make significant investments in storage, handling, and rail systems. These extra requirements increase costs and can create bottlenecks. Local challenges are also posed by these projects. The increased rail traffic, dust and noise can cause opposition in communities. This makes it harder for projects to be approved and sustained. The logistical and social constraints that coal faces further reduce its competitiveness. 4. LIMITED EXPORT UPSIDE This could be a disaster: Key overseas markets may not export coal because they produce it themselves or are moving away from it. As part of the coal revival plan,?boosting export capability is included. This includes proposals for a Gateway linking Wyoming production to ports along the U.S. West Coast that are aimed at supplying Asia. Asia dominates the global coal industry. China, India and Indonesia account for collectively more than 80% global coal supply. This region is also the leader in coal exports, which indicates a structural preference for supplying coal rather than importing it. Although U.S. coal does reach Asian markets, India is a notable purchaser. These flows are driven more by short-term price dynamics than by long-term dependency. India is heavily dependent on coal and investing in alternative sources of energy. If demand does not materialize, then large-scale infrastructure for export could be underutilized or stranded. Projects backed by the public could generate limited returns and lock in significant upfront costs. COAL CRUX These factors, when taken together, point out a fundamental mismatch in policy ambitions and economic reality. The government can intervene to slow the decline of coal, but cannot change the structural forces which have made it less attractive than other alternatives. Subsidies instead risk prolonging the life of an aging infrastructure and encouraging expensive new projects that have uncertain returns. They also support export strategies which are unlikely to be sustained over time. What appears politically appealing in the short-term could prove to be economically counterproductive. These are the opinions of the columnist, an author for. You like this column? Check out Open Interest, your new essential source for global financial commentary. Follow ROI on LinkedIn, X and X. Listen to the Morning Bid podcast daily on Apple, Spotify or the app. Subscribe to the Morning Bid podcast and hear journalists discussing the latest news in finance and markets 7 days a weeks.
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Taiwan and China Coast Guards renew standoff in top of South China Sea
Taiwan reported that the Taiwanese Coast Guard and the Chinese Coast guard were involved in a second tense standoff in the South China Sea near the strategically positioned Pratas Islands on Friday. This was the'second time this has happened in the past two weeks. China considers Taiwan, which is democratically governed, as its territory. The government of Taipei disagrees. China has increased its military presence on the island in the last five years, which has put pressure on Taiwan. The Pratas Islands, controlled by Taiwan, are located roughly between Hong Kong and southern Taiwan. Some security experts believe that they are vulnerable to Chinese attacks due to their location - over 400 km (250 mi) from the island of Taiwan. Taiwan's Coast Guard reported that it saw a Chinese Coast Guard ship on Friday morning. The ship then "forced" its way into restricted waters near the Pratas, after speeding up and turning sharply while ignoring warnings by the Taiwan ship. The Coast Guard reported that the two ships were still engaged in an "intense verbal interchange" and remain in a state of "standoff". The China Taiwan Affairs Office didn't immediately respond to an inquiry for comment. Taiwan's Coast Guard claimed that the Chinese ship was trying to give the false impression of China having jurisdiction over the waters surrounding Pratas. In a press release, it said that "this not only undermines the status-quo of peace and security in the Taiwan Strait but also makes China a troublemaker for cross-strait affairs and regional issues." "Taiwan’s maritime sovereignty?mustn't be challenged." Last time, the Chinese ship left almost two weeks ago. Taiwan's Coast Guard is responsible for the protection of Pratas atoll, which is also a Taiwanese National Park. The military is not involved in this. Taiwan reported that a Chinese drone flew briefly over Pratas in January. (Reporting and editing by Thomas Derpinghaus; Ben Blanchard)
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South Korea's labour minister urges tech companies to share AI profits with their suppliers and staff
South Korea's Labour Minister called on major tech companies to share their windfall profits. He warned that the AI boom, which has brought unprecedented gains in the chip sector, could widen the gap between rich and poor. Kim Young-hoon said in an interview that companies such as Samsung Electronics who?outperform their profit targets, should consider sharing the excess gains after subtracting taxes with their suppliers, subcontractors, and their employees, given their contribution to corporate growth. He said that the South Korean government, business, 'unions, and suppliers' should have a dialogue on how to share these "excess profit" and reduce the gap between larger conglomerates, and smaller suppliers. Kim, an ex-labour activist appointed by the left-leaning South Korean president Lee Jae Myung helped broker a pay deal at the last minute between Samsung and its union. This prevented a major strike, and gave hefty bonuses for its memory-chip employees. In his first foreign interview since the Samsung deal, Kim's proposal for distribution reveals some of the unconventional ideas being considered by top South Korean policymakers as they try to grapple with the huge windfall that the country has received due to the global boom in artificial intelligence. Kim said, "We should establish new rules for distribution by social dialogue." It is indisputable that Samsung's impressive achievements are the product of the hard work and dedication of both management and labour. There are 1,700 suppliers as well as contributions by local communities including water and electricity. The use of AI has fueled a surge in demand for memory chips, resulting in a huge increase for Samsung and SK Hynix. Samsung has agreed that it will give employees special bonuses if the company achieves an annual operating profit of more than 200 trillion won (129,3 billion dollars) from 2026-2028. Kim raised the issue of a public discussion on "what to do with excessive corporate profits" in late May. He has since announced that he will host a forum to discuss the topic. He discussed his thoughts on how to share excess profits, such as by adjusting suppliers' prices, for the first time. Kim was criticized by South Korea's conservative People Power Party, which claimed that he raised "a dangerous notion of state intervention" and undermined the foundations of the?free market economy. The South Korean presidential office has not responded to a request for comment about this story. The South Korean presidential office has said that Kim's remarks raised important questions and it welcomed the idea of debate. Last month, a high-ranking South Korean official suggested that citizens receive a "dividend", using the excess tax revenue generated by AI profits. Samsung and SK Hynix refused to comment. KIM: REINVESTMENT IS NOT COMMUNISM Kim rejected PPP's claim his proposal was "communism," stating that it would be reinvesting in the supply chain and improving competitiveness, as well as helping South Korea overcome the challenges of low growth. He said, "What I meant by distribution was sharing profits with the suppliers." This is clearly reinvestment. Kim suggested that adjusting the contract prices of suppliers could be discussed. He said that such profits could be used to invest in talent for small suppliers. South Korean job seekers prefer larger conglomerates such as Samsung over smaller companies due to wage differences, benefits and other reasons. He said that the divide will widen when workers at large companies get hefty bonuses for their performance, thanks to the AI boom. He said, "This is worrying." Government data shows that the income gap between South Korea's bottom 20% of households and the top?20% increased by the most since six years during the first quarter. Kim stated that a worsening of inequality would slow down the growth of Asia's 4th largest economy. SAMSUNG AVERTED STRIKE It is rare for the South Korean labour minister to get involved in negotiations between unions and companies. Kim claimed that he did so on the request of Samsung Management and the union, after talks had repeatedly broken down. He said a strike lasting 18 days could have severely hurt South Korea's stock market and economy. Kim said that both Samsung and the labour organizers were inexperienced at such negotiations, as Samsung has long had a "no-union" policy. They also had a difficult time figuring out the best way to distribute the unprecedented profits between different stakeholders within the company. He said: "I told President Lee I would use my experience as a leader in the labour movement to establish a relationship with him." Analysts say the Samsung deal may encourage?unions to demand better remuneration at other companies. Kim stated that he didn't want to be involved with every negotiation. He believes there needs to be an underlying framework to help union-company discussions moving forward. But challenges remain for Samsung. Kim stated that the management of Samsung must address discontent within its own ranks over the disparity in pay between its non-memory chip and memory-chip divisions. This could lead to a defection among foundry workers. He said that rewards must be given for short-term results. "However the company must also invest in and motivate the strategic talent for the medium- to long-term."
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Japan increases its efforts to develop sustainable aviation fuels by focusing on cooking oil? ?
Maki Watanabe, a Japanese homemaker from Tokyo, carefully pours the oil used to deep-fry aubergines into a plastic container. She is doing her part in her Tokyo-based kitchen to help increase production of environmentally-friendly jet fuel. "It'd take a lot to make an airplane fly, so I hope that we can collect more," said Watanabe. Her love of cooking allows her a donation of?about 40 litres per year. Her contribution was pooled in a supermarket nearby, which is one of approximately 300 participants involved in a public/private project called "Fry to Fly", amidst the Iran War that has squeezed energy supplies and increased costs for this resource-poor nation. Japan looks to consumers such as Watanabe more urgently than ever before, scrambling to achieve a goal to procure a tenth (10) of airline fuels from sustainable sources by the year 2030. Used cooking oil is a cheap and sustainable feedstock that can be used to make aviation fuel. SAF production in the United States is currently limited to 30,000 kilolitres, or just 0.3% of jet fuel consumption. "We are facing a harsher reality than we expected," ANA and Japan Airlines said in a joint presentation about SAF efforts. The rush to collect cooking oils highlights the challenges facing the aviation industry - one of the largest emitters of greenhouse gases - in trying to reduce its carbon foot print. An investigation conducted last year revealed that only a small fraction of the SAF projects announced by airlines around the world have been implemented. The high cost of SAF has been a barrier to adoption for years, but if we don't reach the volume target for 2030, refiners will face higher costs and airlines more. This is because refiners might need to import more expensive SAF or feedstock in addition to possible penalties. This could have a knock-on impact?for airlines. Singapore, a tiny aviation hub in Southeast Asia, relies heavily upon imported feedstock to reach its 1% goal. The pivotal Year This year is crucial for refiners to continue their SAF efforts. The government has stated that final investment decisions must be made by March in order to ensure mass production in 2030. Eneos, a leader in the industry, said that the amount of cooking oil collected will be a factor when deciding whether or not it will enter into a joint venture with Mitsubishi Corp for the production of 400,000 kilolitres SAF following the fiscal year 2028. Committing to SAF production is a risky decision due to the complex and expensive production process. This includes everything from feedstock collection to hydrogenation and distillation. JGC, the engineering firm that built Japan's first SAF commercial plant in 2010, said that a clearer demand outlook was required to justify increasing production. The joint venture between REVO and Cosmo Energy, a biodiesel producer, has an annual capacity of around 30,000 kilolitres. COLLECTION DRIVE STEPPED UP As the target year nears, public-private supply chain initiatives are increasing their efforts. Tokyo wants to encourage more companies to coordinate and raise awareness about oil collection in the city's 7,8 million households. It distributed 13,000 plastic funnels with QR-coded instructions for collection in the last fiscal year after collecting a meager 160 kilolitres by 2024. This figure was calculated using the formula from the JGC-Cosmo Joint Venture, Saffaire Sky Energy. Yasushi Sato, a Tokyo official, said: "If we do not start now, we will simply not make it to 2030." The retail giants Aeon and 7-Eleven have set up additional drop boxes. UCO Japan, an organization of companies involved in the?recycling of such oil, claims that even if each drop of used oil was collected, it would still amount to 550,000?kilolitres. This would provide about a quarter the SAF needed in?2030. Analysts say that since Japan collects nearly all waste oil available from businesses, SAF is virtually inevitable until technology like producing bioethanol-based Jet Fuel can be used commercially. Motoomi Susi, senior economist, Norinchukin Research Institute said that the goal is ambitious, especially given Japan's current need for domestic feedstock. She added that used cooking oil will be the only option available in the near term. (Reporting and editing by Chang-Ran Kim, Clarence Fernandez and Jekaterina Glubkova)
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Trump will build a Lincoln Memorial promenade in Washington as part of the Washington revamp
Donald Trump announced on Thursday that a promenade would be built onto the Lincoln Memorial, the latest of a number of construction projects Trump has undertaken in the U.S. Capital. Trump said to reporters at the White House that he didn't want it to be called the Trump Promenade. He did not elaborate on who asked to name it for him. Lincoln Memorial is one of Washington's iconic landmarks. It honors the president who led America through the Civil War. The Lincoln Memorial is located at the western end the National Mall overlooking the Reflecting pool, which Trump has also renovated. Trump's announcement is part of an overall effort by the former developer to reshape Washington. Trump also plans to build a 250-foot-long (76-meter-long) arch, and a 90,000.0-square-foot-large ballroom on the site of what was the?East Wing White House. His projects have been challenged in court, including his attempt to renovate a performing arts center named after President John F. Kennedy. A governing board made up of Trump appointees changed the name of the facility from the Kennedy Center to the Trump-Kennedy Center. Last week, a judge ordered that the name be changed to the Kennedy Center. Trump said that the pedestrian promenade will be built across two roads running alongside the memorial, allowing pedestrians to get to other tourist attractions and the Potomac River. He said, "It is a beautiful project and it will take the Lincoln Memorial all the way down to the Potomac as it was planned to do." The White House did not have any additional information on the project. Trump made his announcement?on the?same?day as water started flowing into the renovated Reflecting Pool at the Washington Mall. Trump was particularly interested in the pool, and had a new color installed that he called "American flag" blue. A U.S. Planning Commission on Thursday approved Trump's plans for a 250 foot Triumphal Arch to be built across the Potomac River, from the Lincoln Memorial. "It will, without question, be the greatest arch of all when completed!" In a tweet, Trump welcomed the news.
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Air Current reports that Boeing is weighing 737 production ramp-up in order to reach Airbus targets.
The 'Air Current' reported on Thursday that Boeing is looking at increasing production of its best-selling 737 jet beyond the publicly?stated goal of 63 aircraft a month. Reports citing sources familiar with the situation said that the planemaker was drafting plans and evaluating whether its suppliers would support a production increase of 70 narrowbody jets per month. The ambitious target would test Boeing's supply chain, and bring its production plans closer to Airbus's output goals for the 'competing narrowbody' family. The report stated that the studies were at an early stage, and the higher cadence might not be adopted. Boeing didn't?response immediately to a request for comment. After consulting with the U.S. federal aviation administration, the U.S. planemaker announced in May that it would increase production of its 737 MAX aircraft to 47 per monthly from 42. Kelly Ortberg, CEO of the company, had stated?at a conference in May that "we're on and rolling at a 47-percent rate and should be there within the next couple months." Airbus had long sought to produce 75 A320neo family jets per month, but was forced to push the goal back due to supply chain constraints. Airbus now plans to reach 70-75 jets per month by?end 2027. Production will then be stabilized at 75. The company produces an average of 60 narrowbody aircraft per month. Reporting by Shivansh Tiwary, Bengaluru. Editing by Shilpa Majumdar.
New York Times Business News - June 5,
These are the top stories from the New York Times' business pages. ? These stories have not been?verified? and we cannot vouch for the accuracy of these reports.
Nick Bilton stated that he had spoken to the remaining correspondents of the show, Lesley?Stahl Jon Wertheim Bill Whitaker. They were all considering whether or not they wanted to continue with the show.
The nose gear of a Lufthansa operated Boeing 787-9 Dreamliner?collapsed? while the plane was parked in Frankfurt Airport, Germany.
Jamie Dimon is the CEO of JPMorgan and he plans to make a pitch to investors about 'Elon Musk rocket company', while banks prepare to make hefty IPO fees.
The Supreme Court has ruled that the federal Securities and Exchange Commission (SEC) can recover money from companies or individuals who gained it illegally even if they are unable to prove a loss for investors. (Compiled from Bengaluru Newsroom)
(source: Reuters)